Scatec Solar, Norfund To Jointly Finance Solar Power Projects in Developing, Least Developed Countries

The Norwegian investment fund for developing countries (Norfund) and Scatec Solar have agreed to extend their partnership to all countries covered under the mandate of the Norfund.

Scatec Solar and Norfund will form a joint venture investment company which will invest in solar power projects in countries under the mandate of Norfund. The two entities have so far partnered to set up four solar power projects with total capacity of 200 MW in Africa.

As per the new arrangement, Scatec Solar will hold 70% share, while Norfund will hold 30% share in the joint venture investment company. Decisions to invest in projects will be taken following mutual consultation and consensus.

A number of developing and least developed countries in Africa, South America, and Asia are expected to benefit from this new partnership. Six countries from South America, 16 countries in Africa, and five countries in Asia are currently covered under Norfund’s mandate.

Renewable energy is the single largest beneficiary of the Norfund investments. As of December 2012, 49% of all investments made by Norfund were in the renewable energy sector, followed by small and medium enterprises funds with a share of just 16%.

Norfund has been assisted by Norwegian power producers as well as international companies like Scatec Solar in its strategy to support renewable energy projects across the world. Norfund provides equity investments to renewable energy projects, and facilitates additional financing and technical expertise through companies like Statkraft, Trønder Energi and BKK.

Norfund had earlier signed an agreement to invest NOK 119 million (US$ 18 million) in three solar photovoltaic power projects developed by Scatec Solar in South Africa. These projects, with a total installed capacity of 190 MW, are part of the Renewable Energy Independent Power Producer Procurement Program. Norfund is expected to invest a total of NOK 190 million (US$ 30 million) in the solar power projects in South Africa.

Image credit: Scatec Solar